Room at the Top:
PepsiCo's KFC Scouts
For Blacks and Women
For Its Top Echelons
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Fried-Chicken Chain Seeks
Well-Seasoned Managers
Like Lawrence Drake, 37
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The $150,000 Onion Breader
By Joan E. Rigdon11/13/1991
The Wall Street Journal
PAGE A1
(Copyright (c) 1991, Dow Jones & Co., Inc.)When Larry Drake found himself mixing mashed potatoes at a Kentucky
Fried Chicken outlet in a suburb of Pittsburgh last winter, he worried that
his friends wouldn't understand.Months earlier, Mr. Drake had worn tailored suits and cuff links to his
job at Coca-Cola Co., where he managed $100 million of bottler
accounts. A 10-year veteran of Coca-Cola, and one of its
highest-ranking black executives, Mr. Drake earned more than $100,000
a year, including bonuses. He had just received his master's degree in
business and was aiming for a vice presidency.Then he got an offer he couldn't refuse. The Kentucky Fried Chicken unit
of archrival PepsiCo Inc. was looking for senior executives who could
run a business. There was just one hitch: No senior position was
immediately available. Despite that, Kentucky Fried Chicken offered
Larry Drake the title of vice president, annual compensation of more than
$150,000 and the promise of an executive position within a year.
Meanwhile, he would train in the company's restaurants, learning the
business from the kitchen up.This is the fast track, Kentucky Fried Chicken style. For two years, the
fast-food chain has been looking across industries, snapping up other
companies' seasoned managers for its so-called Designate program. In
addition to attracting fresh thinkers in general, Kentucky Fried Chicken
uses the program to try to correct one of corporate America's most
intractable problems: attracting and keeping female and minority-group
executives.The company makes no bones about its goal. "We want to bring in the
best people," says Kyle Craig, president of Kentucky Fried Chicken's
U.S. operations. But "if there are two equally qualified people, we'd
clearly like to have diversity." The program is achieving noteworthy
results: In 1989, none of the company's 17 senior U.S. managers were
minority or female; today, seven are.That is a better record than at many American corporations, where,
despite widespread efforts, women and members of minority groups have
made slow progress climbing the ladder. American companies have tried
many strategies for integrating their ranks, including recruiting at
minority-group job fairs, hiring diversity consultants and, more recently,
retaining search firms owned by women and members of minorities.
Gilbert Tweed Associates, a New York executive search firm, reports
that 14% of this year's searches were dedicated to finding women and
minority candidates, double the 7% of 1987.Other companies have proved that however difficult the task of
integrating management, it can be done. As of last year, 14% of Xerox
Corp.'s managers at the vice president level and above were blacks, up
from 3% in 1980. Merck & Co. had 11% minority-group managers by
last year, up from 7.2% a decade ago.But these are the exceptions. Among companies with 100 or more
employees, whites still account for 90% of managers, with white men
outnumbering white women by almost 3-to-1, according to a 1990 study
by the Equal Employment Opportunity Commission. Black men account
for just 2.9% of managers; black women, 2.1%; Hispanics, less than 3%;
and Asians, less than 2%.Companies say slow progress in minority-group hiring and advancement
is caused partly by a limited hiring pool. Many minority-group executives
fend off calls from companies once a week, says F. Hassan Shariff, a
recruiter for the Johnson Group, another New York search firm. "There's
not a lot of them out there," he says. Indeed, Kentucky Fried Chicken's
Designate program draws on the same small pool of high-ranking
minority-group and women managers that would attract many other
companies. But KFC points out that it actively promotes women and
blacks into its middle-management ranks, and that its Designate
executives help train future executives within the company.Adding to the struggle to integrate America's executive suites is a series of
challenges to affirmative action programs and hiring quotas. Supreme
Court Justice Clarence Thomas has loudly denounced affirmative action
programs. Whites say they are being unfairly deprived of jobs by
minority-group candidates who are less qualified. Others says affirmative
action stigmatizes people by focusing on race instead of talent. Stephen
Carter, a Yale University law professor and author of "Reflections of an
Affirmative Action Baby," calls affirmative action "racial justice on the
cheap" because it is less costly than broad-based social programs.But for Kentucky Fried Chicken, aggressively recruiting minorities and
women makes good business sense. The company, which ranks No. 5 in
sales in the U.S. among fast-food concerns, says it is second only to
McDonald's Corp. in number of black customers. And of its 161 middle
managers, 31% are members of minorities and 26% are women.Kentucky Fried Chicken finds candidates for its Designate program by
retaining search firms owned by minority members and women as well as
by white men. Armed with the same criteria, each recruiter is asked to
produce a different slate of candidates: all white men, all women (white
and minority) or all black men. One person is hired from each search;
Mr. Drake competed for his slot against six other black men. Of the 13
people that have been brought in under the program, two are white
women, two black women, three black men and six white men.Unlike many of his peers, Mr. Drake wasn't always considered a hot
commodity. Born in Pittsburgh's largely black Homewood ghetto, he says
he took his first job in the fifth grade for 50 cents an hour pumping gas
after school. On the corner where he waited for the bus to his
grandmother's house now sits a KFC restaurant, its cashiers behind
bullet-proof glass.In high school, Mr. Drake sang in the choir and won minority-group
scholarships to summer sessions at Carnegie-Mellon University.
Uncomfortable on a predominantly white campus, he enrolled at Fisk
University in Nashville. Three years later, he dropped out to get married.
The outlook was glum: Living with Madeline Drake's mother in an Atlanta
housing project, the newlyweds had no jobs, no degrees and no savings.
Three months later, Mrs. Drake learned she was pregnant.Mr. Drake kept the family afloat by working days and nights for a year
before going back to school at Georgia State University, where he
received a degree in sociology with a minor in business. The degree -- the
first one in his family -- earned him a place in a management-training
program at Kraft Inc., where he worked for four years before answering
a newspaper ad for a management-training position at Coca-Cola in
1980.Two weeks after taking the job, Mr. Drake says a colleague warned him
that the company didn't like "aggressive blacks." But the warning proved
without basis, and Mr. Drake won promotions every two years for the
next decade, working his way up from trainee to account group director
in 1989. Yet in the end, he felt he had stalled as a middle manager.While Mr. Drake declines to talk about his frustrations, his wife says he
was discouraged when colleagues of equal seniority landed promotions
he wanted. "There always seemed to be a stumbling block," Mrs. Drake
recalls. His bosses "were saying, `Be patient, we want to groom you.'
They wanted to make sure he was ready because when you are a
minority, everybody is looking at you."Women and minority members who reach the executive suite are "always
on stage and on guard," says Nathaniel "Toby" Thompkins, a diversity
consultant at Harbridge House, a Boston-based training firm. For Mr.
Drake, that's a tough mandate. "I can't be the standard bearer for the
entire race," he says.Coca-Cola made no counteroffers when Mr. Drake left because he told
them he wouldn't consider any, he says. A Coca-Cola spokesman says
Mr. Drake was a "fast-track" manager who was slated for more
responsibility within the bottler operations division, though not necessarily
an officership.If Mr. Drake felt frustrated at Coke, he had to fasten his seat belt for his
ride at KFC. His promotion started in November 1990 with the unlikely
task of breading onion rings in inner-city Pittsburgh restaurants, where he
later scrubbed floors beside his colleagues in the middle of the night. Then
he managed clusters of restaurants and, by last June, entire markets.By July, five months ahead of schedule, Mr. Drake got what he wanted.
Now 37 years old, he is KFC's most senior black executive: a vice
president and general manager for the Midwest region. He is responsible
for 259 company and 805 franchise restaurants with combined revenues
of about $800 million. Mr. Drake reports to Mr. Craig, KFC's U.S.
president, and is considered a candidate for senior positions at PepsiCo's
other divisions.In hiring Mr. Drake, KFC had to prevent a backlash among white
workers seeking their own promotions. Mr. Craig says he tried to do that
partly by screening out minority candidates who hadn't already
established solid careers in consumer products or similar fields. Terry
Patch, president of the Dallas-based search firm Andre David &
Associates, which recruited Mr. Drake for KFC, says he had instructions
to find candidates who were aggressive "keepers" at their current
companies, with several years of operations experience and a broad
perspective on business.To make sure the chemistry was right, Mr. Craig asked Mr. Drake to
talk to about a dozen senior executives, including Pepsi's chairman,
Wayne Calloway.Mr. Drake had his own reservations: He didn't want to be a token. Once
KFC made its offer, Mr. Drake says he told Mr. Craig: "I clearly would
not want you to bring me into this organization because I'm black." Mr.
Craig says he agreed: "I'm glad to find people with strong management
skills who are interested in KFC and who happen to be black."Almost a year later, Mr. Drake says he hasn't felt any resentment from
white colleagues, although he acknowledges it is possible since "people
don't always say what they think." Anthony Wedo, a white graduate of
the Designate program who now reports to Mr. Drake, says Mr. Drake
has never mentioned race. And, Mr. Wedo says, a black manager to
whom he acts as mentor also never brings it up. "We don't have a lot of
time to get hung up on whether you're black, white or whatever," Mr.
Wedo says.Minority-group members and women who have been in the KFC pipeline
might also have reason to be jealous, but the company tries to assure
them that their careers won't be hampered by the Designates. Denise
Griffith, a black woman who joined KFC in 1981 as a $21,000-a-year
trainee, now manages the Baltimore and Washington, D.C., markets and
makes $100,000 a year with bonuses. "I personally don't have a
problem" with Mr. Drake's promotion, she says. "There are clearly a lot
of people in corporate America who can translate some of their skills to
the Pepsi environment. Just because I've been with KFC for 10 years, I
don't think I should get first shot."Mr. Drake increased the odds of his acceptance by recruiting allies. A
hard driver who insists that his two teen-age children wear slacks or
pressed shorts even when going to the mall on a Saturday, he had an
energetic presence that earned him a reputation as a fireball. In his early
weeks, he met as many of his new colleagues as he could. But as a
former Coca-Cola man in Pepsi land, he was nervous. "You dread, of
course, telling them you're from Coke," Mr. Drake says. "Sometimes I
told them I was from a consumer-products company."Next, he called other KFC executives and invited himself into their
markets for a brief visit, figuring he could learn about the business and
make friends at the same time. Meanwhile, he offered to help Ms. Griffith
with her career; in return, she passed along tips on Pepsi and its culture.
Now the two talk strategy on the phone every week or two.Mr. Drake also tried to get to know fellow senior managers, at the price
of some physical pain. After learning that about half of them ski, Mr.
Drake, who considers himself duck-footed, joined them. "It's very
painful," he says.On the job, Mr. Drake provides insight into KFC's black customers and
managers. After learning that one black area manager was assigned to
work in a Chicago ghetto because he was the "only one who can handle
it," Mr. Drake has lobbied for more rotation, so all managers are exposed
to the suburbs and the inner city.Already, Mr. Drake's experience at KFC has persuaded others to take a
chance on the company. Jeni Bentley, a Northwestern University M.B.A.
who has eight years of experience in the food industry, including at
Quaker Oats Co., applied to KFC's Designate program hoping to
become a company officer one day. While interviewing, she asked Mr.
Drake if she would hit roadblocks because she is a black woman."He was the perfect person to ask," recalls Ms. Bentley, who joined the
program in October. "Just the fact that they were willing to put him in that
position tells me there are opportunities."
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